In the above graphs, an inverse relationship is shown by

A firm can experience increasing, constant and decreasing returns to scale for various levels of output

What will be an ideal response?

A conclusion of the theory of rational expectations is that, in the short run, the impact of discretionary fiscal policies designed to shift the AD curve will:

a. result in no net change in AD once people's expectations adjustments have been accounted for b. shift AD in the opposite direction intended once people's expectations adjustments have been accounted for. c. be anticipated and compensated for, causing no significant effect on real or nominal GDP or employment. d. have to be a surprise to change real output in the intended direction.